“A COLD DOUCHE”

Wanganui Chronicle, Volume 79, Issue 185, 6 August 1936, Page 7

“A COLD DOUCHE”

LABOUR BUDGET Economic Improvement But ■ Taxes Increased OPPOSITION OPINIONS [Per Press Association] „ WELLINGTON, Aug. 5. / The attitude which the Opposition will adopt towards the proposals contained in the Budget submitted to the House of Representatives last night was fully discussed at a caucus of the National Party. In a statement at the conclusion of the caucus the Leader of the Opposition, Hon. G. W. Forbes, made some pointed comments on the Budget and announced that the Budget debate in the House to-morrow night would be opened by Hon. J. G. Coates, who was Minister of Finance in the latter years of the Coalition Government. “I look upon the Budget as a cold douche on the hopes of many thousands of people that, with the improvement of economic conditions, there would be some relief from the serious burden of taxation that was imposed to meet the necessities of the depression,” said Mr. Forbes. “Instead of .hat, the burden has been made heavier without a single remission. The statements of the Prime Minister during the election campaign that taxation would not be increased have evidently been forgotten.” Mr. Forbes referred to the wonderful recovery of the Dominion as was evidenced by the fact that the Government could rely upon another £3,000,000 from increased revenues. That was not sufficiently large, however, to provide for the Government’s spending programme, so the taxpayer was to be called upon to provide an additional amount of £1,800,000. The whole provision of social services, pensions, etc., depended upon the soundness of the economic structure, and the piling up of the financial burdens undoubtedly weakened the stability of that structure. Effect on Industry. “The excessive taxation such as is proposed, in addition to the enormously increased costs added to industry by the Government's industrial legislation, must slow down the wheels of industry and discourage the initiative and enterprise of citizens generally,” said Mr. Forbes. “No thought has been given to the effects of increased taxation on progress and increase of production which means so much to the general prosperity affecting all our citizens. “A notable point in the Budget is the fixing of the price arbitrarily of dairy produce at a point which is below the present market price. This must cause considerable disappointment in the minds of those dairy farmers who were looking forward to the improvement of prices of which there are definite signs to enable them to make up some of the leeway of the lean years of the depression. “The failure of the Government to appreciate the urgent need of making adequate the defence of this country is another notable point in the Budget. The increase proposed in the Budget is only trifling with a very serious and urgent matter.” Mr. Forbes said the references in the Budget to the adjustment of mortgages was involved and it was difficult to know on what basis the Government intended to proceed. Those people who had money invested in houses and land would be watching the position with a great deal of anxiety and one would have expected the Budget to be more definite on such an important point. It was not made clear how the Government was going to finance public works. When the present Government was in Opposition the party had protested against the use of the Unemployment Fund for the carrying out of public works, but under the proposals of the Budget it was apparently intended to use the Unemployment Promotion Fund for that purpose. good deal had been expected of the Government in regard to remission of taxation but nothing had been done. During the election campaign and since it had been promised by the Government that the sales tax and gold export duty would be removed, but those promises had failed to materialise. Another surprising feature of the Budget was the Minister's failure to make any reference to the land settlement policy. Such references had been a feature of the Budgets for years past and one was entitled to ask whether the Government had any land policy. There was nothing in the Budget to show it had one. Mr. Forbes said he would be speaking later in the debate and would probably reply to the Prime Minister.